UK interest rates slashed to 50-year low

The Bank of England has slashed interest rates by 1.5% in a dramatic attempt to bolster the country’s ailing economy.

The larger-than-expected cut takes the base rate to 3% - its lowest level in 53 years.

Last month UK interest rates were cut from 5% to 4.5% in a coordinated emergency move by the world’s central banks.

Commenting on the surprise announcement, CBI director-general, Richard Lambert, said: ‘This is a bold and welcome move by the Monetary Policy Committee, and achieves what the CBI had been calling for.

‘This cut [...] should help to ease conditions in the credit markets, and allow banks to pass the benefits on to their customers,’ he added.

Meanwhile, the Federation of Small Businesses claims the reduction in interest rates will ‘make an enormous difference to small firms and will put money in people's pockets before Christmas’.

The move came in the wake of a series of figures which suggest the UK is teetering on the brink of recession.